IRS Workforce Cuts Accelerate: What It Means for Taxpayers and Businesses
- JP Marino, EA
- Jul 25
- 3 min read
The Internal Revenue Service (IRS) is undergoing one of the most dramatic staffing reductions in its history. From January to May 2025, the IRS workforce shrank by more than 25%, dropping from approximately 103,000 employees to just over 77,000. This downsizing is raising serious concerns about taxpayer service, compliance risk, and overall efficiency.
Whether you’re a small business owner, an individual filer, or a tax professional, this shift is likely to affect how you interact with the IRS. Here's what you need to know.
What’s Behind the Cuts?
These reductions are part of a broader federal initiative to consolidate operations under the newly formed Department of Government Efficiency (DOGE). At the same time, the IRS is continuing its transition toward digital systems and automation. The idea is to modernize operations—but it comes at the cost of human capital.
Departments hit hardest include:
Taxpayer services, which lost over 21% of its staff
IT and modernization teams, down 25%
Revenue agents and audit teams, creating longer delays and backlogs in enforcement
Why It Matters
The IRS handles over $5 trillion in annual revenue and serves tens of millions of taxpayers. Shrinking the workforce at this scale means:
Longer hold times when calling the IRS
Delayed processing of paper returns, audits, and appeals
Reduced support for complex tax issues (especially for businesses)
Increased risk of filing errors going unnoticed or unresolved
This isn’t just a service issue—it’s a revenue issue. Experts like former Treasury Secretary Larry Summers warn the federal government could lose up to $1 trillion in tax revenue over the next decade due to declining compliance.
With fewer staff and increased reliance on automation, you’ll likely notice delays in correspondence response and refund processing, limited access to live agents during filing season, more reliance on online portals and automated tools, and reduced clarity when resolving tax disputes or audits. If you’re dealing with a complex situation—or trying to resolve a back-tax issue—these service limitations can lead to costly delays.
How You Can Protect Yourself
At Marino Tax Solutions, we strongly advise proactive tax planning and documentation. Here’s how to prepare:
Keep complete records of all filings, notices, and correspondence.
Use certified mail or electronic filing to track submissions.
Respond to IRS letters promptly—delays can create compounding issues.
Work with a qualified tax professional who can advocate on your behalf and navigate communication channels efficiently.
Why Marino Tax Solutions?
The acceleration of IRS workforce reductions isn’t just an internal change—it’s a national tax administration challenge. For taxpayers, the best defense is preparation, awareness, and support.
We understand that life gets busy and tax rules can be overwhelming. That’s why we specialize in helping individuals and families recover missed refunds, file back taxes, and take advantage of every credit available to them.
At Marino Tax Solutions we are committed to informing you about the latest tax policies and programs, including updates from the IRS, to ensure our clients receive accurate guidance for making informed financial choices.
Curious about how these tax changes could impact your personal or business finances? Marino Tax Solutions is here to assist you. Contact us today for a Free Consultation and customized tax planning solutions to help you stay ahead and capitalize on these new opportunities.
Disclaimer: The information provided in this blog is for general informational purposes only and should not be considered tax advice. Tax laws are complex and subject to change. Please consult with a tax professional like Marino Tax Solutions to discuss your specific circumstances.
